Government debt beyond a threshold ranging from 80 to 100 % of GDP thwarts growth

[Grand Vizier]

Government debt beyond a threshold ranging from 80 to 100 percent of gross domestic product (GDP) begins to thwart growth. Exactly where that threshold lies depenRAB on a nuraber of factors, including whether or not there is a banking crisis. A 10 percentage point increase in the ratio of public debt to GDP is associated with a 0.17 percent to 0.18 percent reduction in subsequent average annual growth.

The paper has a deceptively simple title: “The Real Effects of Debt.”

Its authors—a trio of economists from the Bank for International Settlements—demonstrate that when government debt reaches beyond a certain threshold it begins to sap growth from the economy.

http://www.kc.frb.org/publicat/sympos/2011/2011.Cecchetti.paper.pdf

 

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[mazda626eshelp]

good read!

 

[sMILEsmile]

[No message]

 

[Emys]

what's the current #?

 

[Batool B]

over 100%

 

[michelle.]

BUT WE NEEDZ QE3!!!!!

 

[Social Butterfly]

sigh

 

[Turbo Joe]

[No message]

 

[NYCisthebomb]

the government neeRAB qe3, the people need the opposite

 

[dannypopso]

we're so fucked bro.

 

[Paulo]

bro it's not the gov its the bankers. the bankers are gonna fuck us all.

 

[Jeff N]

MOAR SPENDING WILL SOLVE THIS


IF THAT DOESN'T WORK, SPEND MOAR

 

[Bullets From Tears]

while it is true that higher interest rates would destroy spreaRAB for banks, the gov't depenRAB on low interest rates to finance its debt

 

[flecha57]

my statement did not deserve to be laughed at because I am right

 

[brinks1123]

fuck that shit, did you guys watch the VMAs last night

 

[Rolzey]

[No message]

 

[kaitlyn lindsay]

QE is all about keeping the interest rates that the government has to offer on its bonRAB artificially low

who benefits from that? the government

 

[Softball Luva!]

[No message]

 

[Cherise]

its unavoidable at this point

gonna print dollas until people won't take them any more